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A Review of the Numbers: Discretionary Spending Levels, the Budget Control Act, and the Sequester

By Shai Akabas, Brian Collins

Wednesday, December 11, 2013

The long-running debate over discretionary (annually appropriated) spending levels has become immensely confusing. There have been so many different plans and figures thrown around over the past several months that it has been easy to lose track—even for close watchers of the federal budget.

For that reason, we present spending levels set by the Budget Control Act (both the original caps and the post-sequester caps) and compare them to spending under the Bipartisan Budget Act of 2013; the Fiscal Year (FY) 2014 proposals in President Obama’s budget; the Senate-passed budget authored by Chairman Murray; the House-passed budget written by Chairman Ryan (R-WI); and the  levels of the 2013continuing resolution (CR) levels.

Although various elements of the president’s budget and the Senate-passed budget differ, they share the same overall funding levels for defense, non-defense, and total discretionary spending—so they are considered as one element for the purposes of this comparison. The figures below for the CR are annualized levels.1

For defense spending, the proposed deal falls slightly above the full-year CR (and far above the sequester cap), but well below both the original Senate and House proposals for defense spending.

For non-defense discretionary spending, the proposed deal is below the Senate Democrats’ plan and above both the CR and the House Republicans’ plan.

Note that the full-year CR would meet the sequester’s FY 2014 requirement for non-defense spending, but would put defense spending approximately $20 billion above the level allowed by the sequester.2 Therefore, a full-year CR with no modification of the sequester caps would mean no additional cuts to non-defense spending, but would require another $20 billion across-the-board cut from defense discretionary spending in FY 2014.

The Senate budget returns total spending to pre-sequester levels. The House plan, alternatively, keeps total discretionary spending at the reduced sequester level (but brings defense spending back up to the level of its pre-sequester BCA cap by moving about $54 billion from non-defense to defense spending). The Bipartisan Budget Act falls roughly halfway between these levels.

The Bipartisan Budget Act marks a compromise between the spending levels proposed in the House and Senate budgets. The spending increases relative to the sequester will be paid for by a variety of fees and reductions in mandatory spending that we will analyze in the near future.

This post has been updated since its original publication on December 9, 2013.

Alex Gold contributed to this post.


1 This means that if spending continued at the same rate for all of FY 2014 as it has since the October agreement to reopen the government, the figures presented above are the full-year spending levels that would result. The current CR expires on January 15, 2014.

2 The FY 2013 full-year appropriations, passed in March, bumped up defense discretionary spending by nearly $10 billion at the expense of non-defense discretionary spending. (Total discretionary spending subject to the caps for FY 2013 remained at the sequester level.) Since FY 2013 funding levels were extended for the beginning of FY 2014 with the October CR – defense spending is over its cap from the Budget Control Act while non-defense is already under.

KEYWORDS: BIPARTISAN BUDGET ACT, BUDGET CONTROL ACT OF 2011, PATTY MURRAY, PAUL RYAN, PRESIDENT BARACK OBAMA